Every quarter, many money managers have to disclose what they’ve bought and sold, via “13F” filings. Their latest moves can shine a bright light on smart stock picks.
Today, let’s look at Atalanta Sosnoff, which was founded in 1981 and is based in New York City. Its investment style is oriented toward growth stocks, as its managers seek earnings growth and multiple expansion. The firm’s large-cap equity strategy has outperformed the S&P 500 handily since its inception, growing 10.2-fold, vs. 7.3-fold for the S&P 500. In 2010, U.S. investment bank Evercore Partners Inc. (NYSE:EVR) bought a 49% stake in Atalanta Sosnoff.
The company’s reportable stock portfolio totaled $4.1 billion in value as of June 30, 2013.
So what does Atalanta Sosnoff’s latest quarterly 13F filing tell us? Here are a few interesting details:
The biggest new holdings are Canadian Pacific Railway Limited (USA) (NYSE:CP) and The Allstate Corporation (NYSE:ALL). Other new holdings of interest include Pinnacle Foods Inc (NYSE:PF) and Eaton Corporation, PLC Ordinary Shares (NYSE:ETN). Pinnacle Foods Inc (NYSE:PF) debuted via an IPO earlier this year, and soon after, initiated a dividend, which yields about 2.8%. Its brands include Birds Eye, Aunt Jemima, Hungry-Man, Van de Kamp’s, Armour, Lender’s, Mrs. Paul’s, Vlasic, Log Cabin, Mrs. Butterworth, and Duncan Hines, among others. With the company carrying significant debt, it’s reasonable that some worry about its interest in acquiring Unilever’s Wish-Bone salad dressing brand and Del Monte Foods’ canned foods.
Power management company Eaton Corporation, PLC Ordinary Shares (NYSE:ETN) has been shifting its focus from international projects to U.S.-based ones. Argus Research recently recommended the stock, but my colleague Rich Smith would steer clear, due to Eaton Corporation, PLC Ordinary Shares (NYSE:ETN)’s debt and valuation. The stock has surged more than 70% over the past year, and yields about 2.5%. Its acquisition of Cooper Industries has it competing with some formidable opponents in energy infrastructure, and also offers it some tax advantages, via Ireland. Risks that it faces include disruption by upstarts.
Among holdings in which Atalanta Sosnoff increased its stake were Pitney Bowes Inc. (NYSE:PBI) and Las Vegas Sands Corp. (NYSE:LVS). Atalanta Sosnoff reduced its stake in lots of companies, including EMC Corporation (NYSE:EMC) and Philip Morris International Inc. (NYSE:PM). Pitney Bowes Inc. (NYSE:PBI) has been attracting income-seekers with a double-digit dividend yield, but it recently slashed that in half. Its remaining 5.3% yield is nothing to scoff at, but investors should assess the company’s business carefully. Its legendary postage-meter business has not been thriving amid proliferating digital communications. To its credit, Pitney Bowes Inc. (NYSE:PBI) has been developing other less-threatened (and higher-margin) businesses, such as providing geocoding software. Still, its revenue and earnings have been shrinking in recent years, and it does carry considerable debt. The stock is heavily shorted, too.